COLUMBUS, OH — A Jefferson County grand jury has returned indictments against three individuals accused of orchestrating a $20 million fraud scheme that diverted federal financial aid and state subsidies, ultimately leading to the demise and shutdown of Eastern Gateway Community College (EGCC).
Ohio Auditor of State Keith Faber announced the criminal racketeering charges Thursday alongside U.S. Department of Education Under Secretary Nicholas Kent at the Ohio Statehouse.
The indictment, filed Thursday in the Jefferson County Common Pleas Court, targets two private contractors and the college’s former top executive:
- Michael Perik: Owner of four for-profit companies contracted by the college. Faces 12 felony counts including engaging in a pattern of corrupt activities, aggravated theft of $1.5 million or more, theft in office, telecommunications fraud, bribery, unlawful interest in a public contract, receiving stolen property, and money laundering.
- Nicole Rowe Colclasure: President and part-owner of the Student Resource Center. Faces 12 felony counts matching Perik’s charges.
- Michael Geoghegan: Former Chief Financial Officer and President of EGCC. Faces nine felony counts including engaging in a pattern of corrupt activities, aggravated theft of $1.5 million or more, theft in office, telecommunications fraud, bribery, and unlawful interest in a public contract.
Attorneys from the Auditor’s Special Investigations Unit (SIU) have been appointed as special prosecutors in the case by Jefferson County Prosecutor Jane Hanlin.
Scheme Compromised Public Funds and Caused School Collapse
Founded in Steubenville in 1968 as the Jefferson County Technical Institute, EGCC served as an affordable educational anchor for local working-class families and displaced factory workers before permanently shutting its doors in September 2025.
According to prosecutors, the alleged fraud took place between 2017 and March 2022. During that period, Perik’s company, the Student Resource Center, partnered with the college to expand online degree programs, including a “Free College Benefit Program” marketed to labor union members and their families nationwide. The program drove EGCC’s enrollment from 8,500 students to more than 60,000, with 90% taking online courses and 80% residing out of state.
Federal law prohibits private contractors from receiving incentive-based compensation for student recruitment and financial aid processing unless they operate as completely independent third-party entities. Prosecutors contend Perik and Colclasure’s companies exerted improper control over internal college operations—including enrollment, attendance verification, and aid access—disbursing funds for ineligible students and failing to confirm if students actually attended classes.
Indictments allege Geoghegan knowingly approved the illegal disbursements, routing millions in improper financial aid and state subsidies to entities controlled by Perik and Colclasure.
A final review by the U.S. Department of Education cited severe compliance failures and calculated $44.4 million in immediate liabilities, projecting long-term liabilities exceeding $259 million due to the college’s failure to maintain proper documentation. A November 2025 state audit identified over $17 million in questioned costs.
“These public resources were supposed to help disadvantaged students in an area of the state where educational opportunities were scarce,” Auditor Faber said in a statement Thursday. “Instead, it appears these individuals took advantage of their positions, and students were left out in the cold.”
All defendants are presumed innocent until proven guilty in a court of law.
